I was at an event last night, where the moderator, Preeti Varathan from QZ observed that there seemed to be a lot of cynicism in the blockchain / crypto space -- in other words, that the whole thing was essentially premised on a distrust of existing systems (fiat currencies, large internet companies, etc). It's an interesting and I would say correct observation, but it's also not the whole story. In addition to the distrust angle, there is also an innovation angle (though it is related to the distrust angle), which I'll get to at the end. But to focus on this question of distrust: a few weeks ago, I was in Amsterdam for the TNW conference, doing a number of things on their "hard fork" track for crypto/blockchain projects. Two conversations stood out: First was David Schwartz from Ripple, who gave what I thought was a fantastic and clear introduction to cryptosystems -- David's main point was that cryptonetworks are about fairness. You set the rules (in code) and once they are set, everyone plays by them on even footing. No one has the ability to rig the system once it is up and running. If this sounds a lot like a description of democracy and the rule of law, I think that's intentional. The framers of the United States had very similar goals -- escaping a system that felt "rigged" and set up a rules-based system that had decentralization (3 branches of government, federal vs states, house vs senate, etc) and checks and balances built in. So why is there a pressing need for fairness (in money, in tech platforms) today? The original bitcoiners were escaping what they saw as unfair depreciation of fiat currency due to inflation -- they were digital gold bugs who wanted a real store of value. Beyond that, there is a generation of application developers who don't trust the platforms they are building on -- developers have a keen appreciation of power dynamics and know when they are getting screwed. And beyond that, there is an even larger macro distrust and erosion of institutions brewing -- for example I hope that the US can hold on to its own (relatively) fair, rules-based system of governance, but that seems as threatened as ever. So there are plenty of reasons to be cynical and distrusting, both of traditional finance, technology and government. On to the second conversation was that same day, at dinner with a number of Dutch citizens. One gentleman made the point that "life is pretty good here, and we like our centralized institutions". Anyone who's been to Amsterdam can probably relate. Here is a picture from near where we were staying:
I was at an event last night, where the moderator, Preeti Varathan from QZ observed that there seemed to be a lot of cynicism in the blockchain / crypto space -- in other words, that the whole thing was essentially premised on a distrust of existing systems (fiat currencies, large internet companies, etc). It's an interesting and I would say correct observation, but it's also not the whole story. In addition to the distrust angle, there is also an innovation angle (though it is related to the distrust angle), which I'll get to at the end. But to focus on this question of distrust: a few weeks ago, I was in Amsterdam for the TNW conference, doing a number of things on their "hard fork" track for crypto/blockchain projects. Two conversations stood out: First was David Schwartz from Ripple, who gave what I thought was a fantastic and clear introduction to cryptosystems -- David's main point was that cryptonetworks are about fairness. You set the rules (in code) and once they are set, everyone plays by them on even footing. No one has the ability to rig the system once it is up and running. If this sounds a lot like a description of democracy and the rule of law, I think that's intentional. The framers of the United States had very similar goals -- escaping a system that felt "rigged" and set up a rules-based system that had decentralization (3 branches of government, federal vs states, house vs senate, etc) and checks and balances built in. So why is there a pressing need for fairness (in money, in tech platforms) today? The original bitcoiners were escaping what they saw as unfair depreciation of fiat currency due to inflation -- they were digital gold bugs who wanted a real store of value. Beyond that, there is a generation of application developers who don't trust the platforms they are building on -- developers have a keen appreciation of power dynamics and know when they are getting screwed. And beyond that, there is an even larger macro distrust and erosion of institutions brewing -- for example I hope that the US can hold on to its own (relatively) fair, rules-based system of governance, but that seems as threatened as ever. So there are plenty of reasons to be cynical and distrusting, both of traditional finance, technology and government. On to the second conversation was that same day, at dinner with a number of Dutch citizens. One gentleman made the point that "life is pretty good here, and we like our centralized institutions". Anyone who's been to Amsterdam can probably relate. Here is a picture from near where we were staying:
It's ridiculously beautiful and every time I'm there I am struck by how happy the Dutch seem to be -- cruising canals by boat, riding bikes everywhere, healthy chubby babies in tow. Even their teenagers are happy. I am obviously being flip here, but the point is -- when things are good, or seem to be good, there's little perceived need to change the system. To the last point about innovation: the thing that I am most excited about here (and I think I speak for most of us at USV) is what a decentralized asset/contract/data layer means for innovation. Because cryptosystems are open source, extensible and forkable by default, and because they operate on rules-based systems without arbitrary centralized control, we now have a wide open environment for innovation, both at the infrastructure and the application layers. We are still so early in seeing what that will actually mean in terms of services that business and consumers can actually use, but we are building a very exciting foundation.
If there's one thing I've learned throughout my years as a human, it's that life is hard and people need help in order to make things work. That help can come in many forms: family, friends, co-workers, teachers, unions, healthcare providers, agents, assistants, coaches, therapists, strangers on the internet, you name it. Point is, we all need it, and good help can be hard to find (assuming we get over the first hump and even start to look). I've been spending a lot of time recently looking at this problem in a particular use case: the rise of the independent worker. As I mentioned in a post last year, I’ve been interviewed a lot about the emergence of the “sharing” or “on-demand” economy (Fastco, Wired,
Over the course of the past year, I've been interviewed a bunch of times about the "peer economy" or the "sharing economy" (Fastco, Wired, NY Times, PBS Newshour), with most of the focus on the public policy considerations of all this, specifically public safety regulations and the impact on labor. A question that comes up every time is: "aren't all of these new independent workers missing out on the stability provided by full-time employment?" (e.g., healthcare, steady work, etc). My answer has been: yes, for the moment. BUT, there is an emerging wave of networked services which will provide this stability to independent workers, albeit in a different form than we're used to seeing. My colleague Albert describes this as the "unbundling of a job" -- the idea that many of the things that have traditionally been part of a job (not just steady money and healthcare, but also sense of purpose, camaraderie, etc.), will in the future be offered by a combination of other organizations, services and communities. Albert takes the idea a lot farther than I will here, where I just want to focus on some of the more immediately practical developments. Thus far, this idea hasn't gotten a lot of press attention, as the number of visible services providing this kind of support has been small. But it is growing, and I expect we'll see at least a small handful of these kinds of services gain traction in the next year. The oldest and most venerable organization doing this is the Freelancers Union. New Yorkers will recognize their subway ads that have run for decades, advertising their programs and member benefits. Freelancers Union's roots are in the pre-networked era, focusing largely on independent creative types in NYC, and their scope has grown dramatically over time, growing nationwide and adding services like insurance and medical plans. What we expect to see a lot more of are services that are tailor-made to support independent workers who reach customers and deliver their work through web and mobile platforms. For example, Peers, which is essentially Freelancers Union for the peer economy. So, what kinds of services are we talking about exactly? Here are a few of the kinds of services we've been noticing and think we'll see more of:
Insurance: One of the biggest challenges in this space has been how to insure it. We're seeing established firms consider how to address the space, as well as brand new insurers that are tailor-made for it.
Job discovery & optimization: Many networked, independent workers make real-time decisions about what kind of work to do (e.g., driving vs. assembling furniture), as well as which platforms to use (uber vs lyft). This is currently a manual, non-optimized process. Increasing discoverability and lowering switching costs will also be an important competitive vector to ensure workers' interests are being met by platforms. (e.g., sherpashare)
"Back office" - taxes, accounting, analytics: Dealing with paperwork is a huge headache for busy independent workers, and we're seeing a bunch of saas-type offerings to help people manage it all (e.g., 1099.is, Zen99, Benny)
Healthcare: Gotta have it. This is a topic in its own right, and not expressly specific to the indie economy, but we are seeing massive experimentation and innovation in how independent actors can buy healthcare (e.g., teladoc, medigo to name 2 of many)
I suspect that by the end of 2015 we will not only have a much longer list of example issues and services, we'll see that some of these have gotten traction and started to make a difference for independent workers. So, if you're a reporter covering this beat, I think this is an interesting angle to pursue. If you're a lawmaker or policymaker, I'd think about this as an important and growing part of the ecosystem. And if you're an entrepreneur working in this space, we'd love to meet you :-)
It's ridiculously beautiful and every time I'm there I am struck by how happy the Dutch seem to be -- cruising canals by boat, riding bikes everywhere, healthy chubby babies in tow. Even their teenagers are happy. I am obviously being flip here, but the point is -- when things are good, or seem to be good, there's little perceived need to change the system. To the last point about innovation: the thing that I am most excited about here (and I think I speak for most of us at USV) is what a decentralized asset/contract/data layer means for innovation. Because cryptosystems are open source, extensible and forkable by default, and because they operate on rules-based systems without arbitrary centralized control, we now have a wide open environment for innovation, both at the infrastructure and the application layers. We are still so early in seeing what that will actually mean in terms of services that business and consumers can actually use, but we are building a very exciting foundation.
If there's one thing I've learned throughout my years as a human, it's that life is hard and people need help in order to make things work. That help can come in many forms: family, friends, co-workers, teachers, unions, healthcare providers, agents, assistants, coaches, therapists, strangers on the internet, you name it. Point is, we all need it, and good help can be hard to find (assuming we get over the first hump and even start to look). I've been spending a lot of time recently looking at this problem in a particular use case: the rise of the independent worker. As I mentioned in a post last year, I’ve been interviewed a lot about the emergence of the “sharing” or “on-demand” economy (Fastco, Wired,
Over the course of the past year, I've been interviewed a bunch of times about the "peer economy" or the "sharing economy" (Fastco, Wired, NY Times, PBS Newshour), with most of the focus on the public policy considerations of all this, specifically public safety regulations and the impact on labor. A question that comes up every time is: "aren't all of these new independent workers missing out on the stability provided by full-time employment?" (e.g., healthcare, steady work, etc). My answer has been: yes, for the moment. BUT, there is an emerging wave of networked services which will provide this stability to independent workers, albeit in a different form than we're used to seeing. My colleague Albert describes this as the "unbundling of a job" -- the idea that many of the things that have traditionally been part of a job (not just steady money and healthcare, but also sense of purpose, camaraderie, etc.), will in the future be offered by a combination of other organizations, services and communities. Albert takes the idea a lot farther than I will here, where I just want to focus on some of the more immediately practical developments. Thus far, this idea hasn't gotten a lot of press attention, as the number of visible services providing this kind of support has been small. But it is growing, and I expect we'll see at least a small handful of these kinds of services gain traction in the next year. The oldest and most venerable organization doing this is the Freelancers Union. New Yorkers will recognize their subway ads that have run for decades, advertising their programs and member benefits. Freelancers Union's roots are in the pre-networked era, focusing largely on independent creative types in NYC, and their scope has grown dramatically over time, growing nationwide and adding services like insurance and medical plans. What we expect to see a lot more of are services that are tailor-made to support independent workers who reach customers and deliver their work through web and mobile platforms. For example, Peers, which is essentially Freelancers Union for the peer economy. So, what kinds of services are we talking about exactly? Here are a few of the kinds of services we've been noticing and think we'll see more of:
Insurance: One of the biggest challenges in this space has been how to insure it. We're seeing established firms consider how to address the space, as well as brand new insurers that are tailor-made for it.
Job discovery & optimization: Many networked, independent workers make real-time decisions about what kind of work to do (e.g., driving vs. assembling furniture), as well as which platforms to use (uber vs lyft). This is currently a manual, non-optimized process. Increasing discoverability and lowering switching costs will also be an important competitive vector to ensure workers' interests are being met by platforms. (e.g., sherpashare)
"Back office" - taxes, accounting, analytics: Dealing with paperwork is a huge headache for busy independent workers, and we're seeing a bunch of saas-type offerings to help people manage it all (e.g., 1099.is, Zen99, Benny)
Healthcare: Gotta have it. This is a topic in its own right, and not expressly specific to the indie economy, but we are seeing massive experimentation and innovation in how independent actors can buy healthcare (e.g., teladoc, medigo to name 2 of many)
I suspect that by the end of 2015 we will not only have a much longer list of example issues and services, we'll see that some of these have gotten traction and started to make a difference for independent workers. So, if you're a reporter covering this beat, I think this is an interesting angle to pursue. If you're a lawmaker or policymaker, I'd think about this as an important and growing part of the ecosystem. And if you're an entrepreneur working in this space, we'd love to meet you :-)
-- splitting apart the support systems that had traditionally been associated with full-time work (salary, benefits, community, training, etc) and leaving workers to fend for themselves. In the past few months, this issue has come to even more of a head, with the
that (in a single case) an Uber driver could be considered a W2 employee and not an independent contractor, and moves by other on-demand platforms move some or all workers from a 1099 model to a W2 model, as
recently did. A year ago, when I started speaking to reporters about this, my consistent answer was that we hope to see a new layer of networked services emerge that will fill the gaps left by the unbundling of the job, that start to solve workers’ issues in creative new ways. And conversely, what I hope we don’t see is a knee-jerk attempt to shoehorn today’s independent, networked workers into the old paradigm of full-time single employer work, throwing the baby out with the bathwater. Sherpashare
of on-demand drivers, asking them what they like and don’t like about this new model of work. Not surprisingly, they love the
flexibility and freedom
that comes with (semi) independent, networked working lifestyle. But they also want
more control over their work
, chafing at the level of control that many of the services-oriented (vs. marketplace-oriented) platforms exert. That makes sense to me. There’s also an obvious need to basic support tools and services (for example around finance and insurance/benefits). Now, a year later, many these kinds of services have indeed begun to emerge. Over the past several months, I’ve spoken to many entrepreneurs approaching this problem, from a bunch of different directions. Here is my latest snapshot of how that market looks today:
Nearly all of these are brand new. Many of them are pre launch, and many of those are just at the idea phase. And, as you’d expect, they are all tackling different facets of the problem. Here’s a quick review of the categories I’ve been tracking: Job Discovery: gotta find work, and there are an increasing number of competing options out there. Matching those opportunities to workers will be important. (see: Dispatcher, Opus for Work, BlueCrew) Education & Training: along with the unbundling of the job comes, to some extent, the unbundling of education & job training. The need here spans both sector-specific training and more general education like financial management. (see: Peers, KungFu) Community: as workers become more independent, we will need new ways to form various forms of community support, from commiserating, to peer-learning, to organizing. (see: Coworker, Domino, Sherpashare) Equipment: gotta have the tools and the space to do the job. (see: CoPass, Breather, ReCharge, IdleCars, Breeze) Admin: keeping track of your finances, expenses and taxes as an independent worker totally sucks. April 15th is doomsday. There are a bunch of tools providing helpful services here. (see Zen99, Benny, Hurdlr, And Co) Banking: money is at the center of everything, and independent workers have unique financial needs, in particular related to lumpy cash flow, saving for taxes, and overdraft & lending. (see: Even) Benefits & Insurance: clearly a huge issue, relating to everything from healthcare, to disability, to liability, to operating insurance. Traditional insurance plans aren’t built for this economy, and insurance will be a huge part of continuing to build trust, safety and security in this sector. (see: Stride Health, Freelancers Union) Identity & Reputation: perhaps the biggest opportunity, in my view. As independent workers work across platforms and services, reputation is their currency. Platforms are built on trust, and workers need to be able to port that trust from one context to another. Unclear how we will get to a world where workers control their identity and reputation data -- could be indirectly, through banking, insurance, or job discovery. (see: Opus.me, Karma, Traity, Checkr) This is surely incomplete, and many of the examples span categories, but it’s a start. The happy confluence There will undoubtedly be many tensions as this market develops, particular around the sharing and control of data (for example, worker-facing APIs and the right to be represented by a bot). There is, however, a nice potential synergy between the needs of work platforms and worker support platforms. In order for work platforms to maintain the arms-length relationship with worker/partner/contractors required for proper 1099 status, they will necessarily need to relinquish some amount of control, which could really open up the market here. We will see. Finally: if you are working on this, I want to know you!
-- splitting apart the support systems that had traditionally been associated with full-time work (salary, benefits, community, training, etc) and leaving workers to fend for themselves. In the past few months, this issue has come to even more of a head, with the
that (in a single case) an Uber driver could be considered a W2 employee and not an independent contractor, and moves by other on-demand platforms move some or all workers from a 1099 model to a W2 model, as
recently did. A year ago, when I started speaking to reporters about this, my consistent answer was that we hope to see a new layer of networked services emerge that will fill the gaps left by the unbundling of the job, that start to solve workers’ issues in creative new ways. And conversely, what I hope we don’t see is a knee-jerk attempt to shoehorn today’s independent, networked workers into the old paradigm of full-time single employer work, throwing the baby out with the bathwater. Sherpashare
of on-demand drivers, asking them what they like and don’t like about this new model of work. Not surprisingly, they love the
flexibility and freedom
that comes with (semi) independent, networked working lifestyle. But they also want
more control over their work
, chafing at the level of control that many of the services-oriented (vs. marketplace-oriented) platforms exert. That makes sense to me. There’s also an obvious need to basic support tools and services (for example around finance and insurance/benefits). Now, a year later, many these kinds of services have indeed begun to emerge. Over the past several months, I’ve spoken to many entrepreneurs approaching this problem, from a bunch of different directions. Here is my latest snapshot of how that market looks today:
Nearly all of these are brand new. Many of them are pre launch, and many of those are just at the idea phase. And, as you’d expect, they are all tackling different facets of the problem. Here’s a quick review of the categories I’ve been tracking: Job Discovery: gotta find work, and there are an increasing number of competing options out there. Matching those opportunities to workers will be important. (see: Dispatcher, Opus for Work, BlueCrew) Education & Training: along with the unbundling of the job comes, to some extent, the unbundling of education & job training. The need here spans both sector-specific training and more general education like financial management. (see: Peers, KungFu) Community: as workers become more independent, we will need new ways to form various forms of community support, from commiserating, to peer-learning, to organizing. (see: Coworker, Domino, Sherpashare) Equipment: gotta have the tools and the space to do the job. (see: CoPass, Breather, ReCharge, IdleCars, Breeze) Admin: keeping track of your finances, expenses and taxes as an independent worker totally sucks. April 15th is doomsday. There are a bunch of tools providing helpful services here. (see Zen99, Benny, Hurdlr, And Co) Banking: money is at the center of everything, and independent workers have unique financial needs, in particular related to lumpy cash flow, saving for taxes, and overdraft & lending. (see: Even) Benefits & Insurance: clearly a huge issue, relating to everything from healthcare, to disability, to liability, to operating insurance. Traditional insurance plans aren’t built for this economy, and insurance will be a huge part of continuing to build trust, safety and security in this sector. (see: Stride Health, Freelancers Union) Identity & Reputation: perhaps the biggest opportunity, in my view. As independent workers work across platforms and services, reputation is their currency. Platforms are built on trust, and workers need to be able to port that trust from one context to another. Unclear how we will get to a world where workers control their identity and reputation data -- could be indirectly, through banking, insurance, or job discovery. (see: Opus.me, Karma, Traity, Checkr) This is surely incomplete, and many of the examples span categories, but it’s a start. The happy confluence There will undoubtedly be many tensions as this market develops, particular around the sharing and control of data (for example, worker-facing APIs and the right to be represented by a bot). There is, however, a nice potential synergy between the needs of work platforms and worker support platforms. In order for work platforms to maintain the arms-length relationship with worker/partner/contractors required for proper 1099 status, they will necessarily need to relinquish some amount of control, which could really open up the market here. We will see. Finally: if you are working on this, I want to know you!
